The country’s finance minister has announced that cryptocurrencies will soon be subject to a 28% capital gains tax.
Finance minister Fernando Medina has announced before a session of the Portuguese parliament that cryptocurrency assets in the country will soon be subject to capital gains tax, according to Portuguese media outlet ECO.
The statement is a definite change in Portugal’s attitude towards cryptocurrencies: since 2018, the country has treated cryptocurrency trading as the exchange of money, not investments, thus exempting cryptocurrencies from any capital gains tax, currently at 28%.
Thanks to an effective tax rate of 0%, Portugal has earned a reputation as one of the world’s most attractive cryptocurrency tax havens. Partly because of this, Lisbon, the capital, has become a global cryptocurrency hub.
Following the announcement, Portuguese officials did not frame this marked shift in the country’s attitude towards cryptocurrencies as a move away from a once business-friendly attitude. On the contrary, lawmakers asserted that Portugal has always intended to regulate cryptocurrencies, and they have been carefully watching how other countries have adapted their regulations to gain insight into Portugal’s own policy decisions.
And it is possible that Portugal will consider other cryptocurrency-related taxes before too long. António Mendonça Mendes, the country’s deputy minister of finance and fiscal affairs, said during the same session of parliament that “cryptocurrencies are a much more complex reality than taxation in terms of capital gains”.
